The UK government has released new figures showing that the cost of prescribing drugs has fallen.

This figure was down 0.4% in the last financial year to £8.3 billion, according to data collated from Primary Care Trusts. But whilst costs have fallen slightly, prescribing volumes increased by 3.9%, illustrating just the tight margins pharma currently deals with in the UK.

The report shows that overall, the cost of primary healthcare rose by 1.2%, with some of the volume growth offset by lower prices. The cost of pharma services to the NHS also rose 6.3% to 2.1billion, according to the report.

The Department of Health said it was still committed to “ensuring the best value for money for the taxpayer from NHS’ expenditure on drugs,” and would be doing this through PPRS drug pricing scheme, which caps pharma’s profits.

This scheme, however, could soon be a thing of the past as the government and the UK pharma industry is currently in negotiations to completely reform drug pricing in the country, and potentially replace the voluntary PPRS with value-based pricing (VBP).

VBP could see the government set prices for new drugs at launch, based upon new definitions of value, and would no longer cap the profits of drugs as it does under PPRS. Some in the pharma industry believes this is a ploy to lower the overall costs of the drugs budget, and the ABPI is working hard to hammer out a deal that benefits its members.  

The DH said it was also looking to lower costs through the community pharmacy contractual framework. This uses the prices of a group of generic medicines to adjust the reimbursement prices of around 500 drugs, which in turn allows profit margins to be monitored, and any excess profit, above that agreed in the framework, to be removed.

The DH said in a statement: “These actions have driven substantial savings in the cost of medicines in recent years, and is partly shown by the decrease in prescribing expenditure indicated in the table above, as the figure also reflects an increase in the volume of drugs prescribed.”